Home Sale Growth across BC Mitigates Lower Mainland Market Slowdown: BCREA

Joannah Connolly
November 15, 2016

October home sales on the Multiple Listing Service® (MLS®) were mixed across the province, with the slowdown in Greater Vancouver partially offset by strong growth in the Vancouver Island and Interior markets, according to British Columbia Real Estate Association (BCREA) statistics released November 15.

However, with Greater Vancouver still making up nearly a third of all BC sales, the Island and Interior growth was not enough to see overall growth in total BC real estate transactions, which were down 16.7 per cent year over year to 7,272 sales. This was a decline of 4.2 per cent compared with September’s 7,591 sales.

“Housing demand remained mixed across the province in October,” said Cameron Muir, BCREA chief economist. “Home sales across the Lower Mainland were down from the elevated levels of one year ago, but stabilized on a month-to-month basis. In contrast, home sales on Vancouver Island and in the Interior of the province continue to post strong year-over-year gains.”

With the average MLS® residential price in the province in October at $606,787, down 9.1 per cent since October last year, that put total sales dollar volume for the month at $4.4 billion, down 24.2 per cent year over year.

“The decline in the average residential price reflects a smaller proportion of transactions in the province originating in Vancouver,” added Muir.

However, that average $606,787 sale price was an increase of 3.6 per cent compared with September’s $585,844, and considerably higher than the dip seen in August ($569,393). October’s month-over-month price declines in the larger markets of Greater Vancouver and the Fraser Valley were not as steep as in August and September, and were more than offset by price growth in other BC regions. This may suggest that resale home prices across BC as a whole are recovering after the uncertainty that August’s new foreign buyer tax created.

Because of the very busy spring market and average prices remaining relatively strong, year-to-date, BC home sales dollar volume rose 27.4 per cent to $70.4 billion, compared with January to October 2015.

Broken down by region, the Vancouver Island, Victoria, Kamloops, Okanagan Mainline, South Okanagan, Powell River and Northern Lights boards all reported year-over-year growth in home sales and total dollar volume.

Canada-wide Home Sales and Prices

Across the whole of Canada, residential resale transactions rose two per cent year over year and 2.4 per cent month over month, setting a new record for home sales in October, according to Canadian Real Estate Association (CREA) figures also released November 15.

Resale transactions were up from October 2015 levels in about 60 per cent of all Canadian markets, with annual declines in BC’s Lower Mainland offset by growth in the Greater Toronto Area and environs, said CREA.

The national MLS® Home Price Index benchmark price (all home types) was up nearly 15 per cent year-over-year in October to $579,800. The average home sale price in October, which CREA pointed out is a less reliable trend measure, was up 5.9 per cent year over year to $481,994.

However, CREA warned that the new mortgage rules introduced on October 17 were yet to take their full effect on the market.

“The expanded stress test for home buyers who need mortgage default insurance took effect in the middle of October,” said CREA president Cliff Iverson. “More time will need to pass before its effect on housing markets can be gauged. The extent to which they will push first-time home buyers to the sidelines may vary among housing markets.”

Joannah Connolly
Joannah Connolly is editorial director of Glacier Real Estate, Glacier Media's real estate division. Joannah writes and curates real estate news for Glacier Media's local newspaper websites, including the Vancouver Courier, North Shore News, Burnaby Now, Tri-City News and others. She also oversees editorial content in Real Estate Weekly Homes, West Coast Condo, Western Investor and Glacier's special real estate publications. A dual Canadian-British citizen, Joannah has 22 years of journalism and editing experience in Vancouver and London, with a background in construction, architecture, healthcare and business media. Joannah has appeared on major local TV outlets as a real estate commentator, has moderated and spoken on various industry panels, and spent two years hosting the Real Estate Therapist radio show on Roundhouse Radio.